What is information system ?

A set of interrelated components that collect,manipulate,store and disseminate data and information and
provide a feedback mechanism to meet an objective

Ways Information System can improve Decision making:

Business process performance variable How information System can improve decision making
Rate of output Make more decision using better, more complete information
Consistency Make sure repetitive decision are made in same way
Productivity Make better decision with less effort
Cycle time Eliminate unnecessary delay in decision making
Flexibility Maintain decision quality across a wider range of situation
Security Make sure decision are controlled only by those authorized to
make decision

Classification of Information System

The scope of the application and the information support needed by the application,irrespective of of the
nature of the organization nad its Size,Business applications ]would fall into one of the 4 categories-offica
Automation,Transactions processing,Decision Support ,Execuitve Support System.

EXECUTIVE SUPPORT SYYSTEM STRETEGIC LEVEL

MIS/DSS TACTICAL

TPS OPERATIONAL

Different Kinds of Information System:

Strategic Level: Executive support System
Management Level: MIS/ Decision Support system
Operational level: Transaction Processed system

Office automation System: helps in processing personal and organizational business data,to perform
calculation and create documents
It’s the Backbone of all other information systems and
Information generate become the corporate Database
It more tuned to generation of information rather then use of information

It include spreadsheet,word processor,telephone,e-mail…

Impact on decision making:
It create documents and presentation,spreadsheet for analyzing information and help in decision making
In Functional Areas:
Sales Unit: spreadsheet to analyze different possible price,word to create sales contract
Manufacturing:Spreadsheet to create production schedule,word to write memo/work information
Finance:
Spreadsheet to compare calculate,word to sens memo about procedure

TPS is an organized collection of people,procedure, software, database, and devices used to record completed business
related exchange such as payments to employees, sales to customers, payments to suppliers
A TPS can speed business activites and reduce clerical costs. (OR)

Transaction Processing System:is the business system operate at the operational level,it’s the computerized
system that perform and records the daily routine transaction necessary to conduct business
Ex: sale order entry,employee records,payroll,shipping

TPS:is to capture,process,and update database of business data required to support routine business activities

Transaction processing System,particularly order processing systems,are the backbone of an organization,it

assist businesses in paying bills from suppliers,paying employees,and receiving payments from customers.using
these system which collects valuable information about product that have being sold and gained desire
customer satisfaction,salesforce which can meet its customer needs by conducting transaction in an efficient
manner,anywhere,anytime,also can get access to past transaction data in order to develop customer
relationship management

Every organizations has many transaction processing systems,which captures and process the detailed data
necessary to update records about the fundamental business operations of the organization,it include order
entry,inventory control,payroll,account payable-receivable, as inputs of the system includes basic business
transaction,such as customer orders,purchase orders,receipts

The processing activites include data collection,data editing,data correction,data manipulation,data

storage,document production

The results of processing into records are updated to reflect of processing operation from time to time

Two type of TPS:

-Batch processing:busieness transactions are accumulated over a period of time and prepared for processing as
single unit/batch eg:payroll and billing processing is more appropriate and cost effective
-Online transaction processing:transaction is processes immediately,without delay reflects current status
Eg: current data such as airlines,bus ticket agencies,and stock investment,e-commerce with help of internet
Importance of TPS:
-It capture,process,and update database of business data that support routine activiites
-It process accurately and completely as reports generated are further used to execute operational activites
-It increase labor efficiency by redicing clerical and other labor requirement
-Improve customer satisfaction and build customer loyalty
-Achieving competitive advantage: By providing superior service which result in customer satisfaction by
maintaining better relationship which reducing cost and result in customer loyalty.

Transaction Processing Cylce:The process of data collection,data editing,data Correction,

Data manipulation,data storage,and document production
Original data
Data Collection: capturing &gathering all Data
The data necessary to complete the processing collection

Data Editing:process of checking data

From validity & Completeness
Data
Good data
bad editing
Data Correction:Process of reentering data
That was not typed /scanned properly Da Data
Data manipulation
correction
Data Manipulation:Process of performing
Calculation & data transformation related to Data storage
Business transaction
TPS Reports
Data Storage: Process of updating one/more Document
Database with new Transactions Production

Document production:The process of generating

Output records and reports

Indetails, Data Collection: capturing &gathering all The data necessary to complete the processing like collecting sales
orders which are handwritten,change in inventory /scanner,devices

Data Editing: for validity and completeness to detect any problems like quantity and cost must be numeric and names
must be alphabetic
Data correction: if the data is not clear it rejects by providing error message by specifying the problem for correction, it
involves reentering of the data that was not inappropriate
Data manipulation: it the process of performing calculations and other data transformation related to business
transaction, it involves classifying of data, sorting of data in categories, performing calculation, summarizing results,
and sorting data
Data storage: Updating one/more database with new transaction, by this it will be available for mgmt reporting and
decision making.
Data production & Reports: these can be hard-copy paper reports/displays on computer sreens.

Management Information System:

MIS: is an organized collection of people,procedures,software,database and devices that provides routine
information to managers and decision makers with information to help achieve organizational goals by
providing right information at right time in right format to right people
.its major focus on operational efficiency.marketing,production,finance,other functional areas are supported by
MIS and linked through a common database.

MIS providing immediate assistance in solving comples problems

Marketing MIS Manufacturing MIS

Common
Database

Financial MIS other MIS

TPS

Functions of MIS:
- Collection of Data ,- Storage of Data
- Process of the Data
- Present information to Manager

Characteristics of Management information System:

-Provide reports with fixed and standard formats.
-produce hard-copy and soft-copy reports
-It uses internal data stored in the computer system
-Allow users to develop their own custom report

Input to a MIS:
Data enters an MIS originate from both internal source from TPS and database and external source include
customers, suppliers, competitors and stockholders whose data are captured by internet

Output to a MIS: most of the output are collection of reports that are distributed to managers
The new eporting system creates an “executive dashboard”that shows the current data,graphs,tables to help
managers make better real-time decision.
Management reports can come from various company database and other sources:

It generate Collection of Reports

-Schedule Report:A report produced periodically,on a schedule(Daily,weekly/monthly)
-Key-indicator Report: summarizes the previous days’s critical activites which provide at the beginning of each
workday. Eg: inventory level, production activity, sales volume
-Demand Report: Demand Reports;these are developed to give certain information on request/on demand
Eg: Queries of the company
-Exception Report:A report automatically produced when a situation is
unsual/requires a management action
-Drill-Down Report:A report provide increasingly detailed data about a situation
 Financial scheduled
report
MIS In FUNCTIONAL AREAS:
TPS

d Manufacturi scheduled
a ng report
ERP/TPS t
TPS a
Marketing scheduled
report

TPS HRM scheduled

report
Databas

external

Other scheduledr
eport

Decision Support System:

An organized collection of people,procedures,software,database,and devices used to support problem-specific

decision making.DSS can support customers by rapidly responding to their phone and e-mail inquiries.

DSS- can help by suggesting alternatives and assisting in final decision making.

Decision Support System

Characteristic of Decision Support System
-Provide rapid access to information
-Handle large amount of data from different sources
-Provide report and presentation facilities
-Offer both textual and Graphical orientation
-Support drill-down Analysis
-Perform complex ,sophisticated analysis and comparison using aadvanced software package

Expert system:
It’s a computer based system /programs that use artificial intelligence technique to solve problems that require a know
ledgeable human
Expert System: system give the computer the ability to make suggestions and act like an expert in a particular
field ,they have been used to monitor nuclear reactors ,perform medical diagnoses,locate possibility repair
problems.develop marketing plans for a new product

Advantage Of Expert System:

-A Computer can store far more information than human
-A computer do not forget /make mistake
-Data can be updated time to time
-Its available 24 hour a day
-Huma expert do not need physical presence
-It include Knowledge of many experts in one specified field

Executive support system(executive Information System)

It helps Top-level managers(president,VP,Members of the Board to take decision

Executive Support Syystem:

It supply necessary tools for Senoir Mgmt

IT provide rapid access to timely information and direct interaction to management reports,supported by graphics

Advantage of ESS:
Simple for highly executives to use operation
Provide timely information of the company
Provide better understanding of information by filtering
Disadvantage of ESS:
Computer skills require
Types of Impact on decision Sales Unit Finance Manufacturing
information making
system
Office helps in It create documents and spreadsheet Spreadsheet to Spreadsheet to
automation processing presentation,spreadsheet to analyze compare create
System personal and for analyzing different calculate,word production
organizational information and help in possible to sens memo schedule,word
business decision making price,word about to write
data,to to create procedure memo/work
perform sales information
calculation and contract
create
documents
Transaction It collect & Provide information for Keep track Processing of Tracking
Processing store planning & implementing of customer credit payment, movement of
System information also provide immediate contacts receivable work in factory
about feedback on decision and sale
transaction made transaction
Mgmt Convert TPS Provide summary Weekly Report of Weekly
information data into information & measure sales report receivable production
system information for performance for by product &payment and report and
monitoring monitoring results and region monthly determining
performance & and financial plan planned
managing projection purchase based
organization report on schedule
Decision Helps people Provide tool for To analyse Model in To analyze
support make decision analyzing data and sales test selecting the production
system by providing evaluate alternative alternatives stock results
information
models